GBP/USD, EUR/USD remain bearish, USD/JPY bullish as US dollar rises for tenth consecutive week
Outlook on GBP/USD, EUR/USD and USD/JPY as the greenback continues to appreciate amid ‘rates higher for longer’ scenario.
GBP/USD remains under pressure in six-month lows
Following last week’s decision by the Bank of England’s (BOE) to keep rates steady at 5.25%, the British pound remains under pressure and continues to trade in six-month lows versus the greenback.
A fall through last week’s $1.2235 low would eye the mid-March high and 24 March low at $1.2204 to $1.2191.
Minor resistance for GBP/USD continues to be seen at the $1.2309 May low and significantly further up along the 200-day simple moving average (SMA) at $1.2435. While remaining below it, the medium-term bearish trend remains intact.
EUR/USD hovers above its 3 ½ month low
EUR/USD continues to hover above its $1.0615 current September low as traders await the German Ifo Business Climate Index and testimony to eurozone lawmakers by the European Central Bank (ECB) president Christine Lagarde.
A fall through and daily chart close below last week’s low at $1.0615 could lead to a slide towards the January and March lows at $1.0516 to $1.0484.
Any potential bounce above Friday’s $1.0671 high is likely to fizzle out ahead of the $1.0766 to $1.0769 late August low and mid-September high.
USD/JPY trades in 10-month highs
USD/JPY's rise is ongoing as the US dollar has seen its tenth consecutive week of gains amid the Federal Reserve’s (Fed) hawkish pause while the Bank of Japan (BoJ) rigorously sticks to its dovish stance and keeps its short-term interest rate at -0.1% and that of the 10-year bond yield at around 0%.
USD/JPY flirts with its 10-month high at ¥148.48, made on Monday morning, a rise above which would put the ¥150.00 region on the map, around which the BoJ may intervene, though.
Immediate upside pressure will be maintained while USD/JPY stays above its July-to-September uptrend line at ¥147.76 and Thursday’s low at ¥147.33. While this minor support area underpins, the July to September uptrend remains intact.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
